The Hope Institute is a think and do tank promoting social innovation in South Korea. Through its partner network, it develops policies and programs based on its experience implementing grassroots solutions to social problems.
I visited The Hope Institute’s office in Seoul and interviewed Ms. So Yeon Yang, a researcher at the Social Innovation Center and Ms. Ahyoung Park, a researcher at the Center for Social Economy.
How would you describe social innovation in South Korea? How much interest does the public have in this sector?
Park: People’s attention towards the social innovation sector is fast growing in South Korea. Many start to feel that they do not live a happy life by working for large corporations. They are seeking a different way to fulfill their lives. Social innovation could be an answer to their questions, providing them an alternative choice to live a fulfilled life. However, most of these people don’t know how to start social enterprises from their previous experience working in large companies. We could help them here. At The Hope Institute, we run peer-counseling programs for newly registered social enterprises in Seoul. This means new social entrepreneurs can get counselors, who are experienced social entrepreneurs, through our program.
Could you elaborate on this program (peer counseling program)?
Park: As a part of the peer counseling program, we provide several specific training series to help young social enterprises establish their social missions and business models. We were quite surprised to see that in some cases, these organizations did not have accurate concepts of their social missions or business models. It requires quite a bit of work to get to a stage where people are clear about their own social missions or models. Those are crucial for achieving sustainability. And there are differences between social entrepreneurs who have prior business experience and entrepreneurs who do not.
Is there any other program The Hope Institute runs to promote public awareness in social innovation?
Park: Another program we have is the public officer educational program. The reason we established this program was first, we felt public officers had to change their mindsets about social innovation. Secondly, a lot of local governments in South Korea have departments that promote social enterprise. Public officers usually have the ability to change things on a larger scale. They could also test ideas in small communities, evaluate results and expand those initiatives to larger communities.
One unique thing about South Korea is you have a Social Enterprise Act that strictly defines the term “social enterprise”, which many other countries do not have. What do you think about this Act?
Park: It has been about six years since the Social Enterprise Act was created. Our government tried to create social enterprises by outsourcing some social services. On the one hand, we did leverage the Social Enterprise Act to create more social enterprises quantitatively. The government is giving out funding to support social enterprises. We also ensure that people do not use the term “social enterprise” unless they meet all the criteria specified by the Social Enterprise Act.
On the other hand, some social innovators view “social economy” quite different than how the government views it. A general consensus is we still lack infrastructure support to those social enterprises. That’s why we have intermediaries trying to provide training programs. However, most of these intermediaries, or supporting agencies you would call, lack the human capital and scale. Many of them are very local and only have three to four employees. In conclusion, an Act alone is not enough for building a social economy. We need to build the whole ecosystem.
There is a lot of buzz about the recent “Social Co-operative Law” in South Korea. What do you think about the new law?
Park: I was actually quite surprised that people are very interested in co-operatives here. They seem to believe in co-operatives’ power. We launched in the new law on December 1st, 2012. Over 100 organizations already registered in the first month of the launch. Many media are featuring news about the new co-operatives. Just yesterday, two progressive newspapers featured co-operatives in their front pages. We have two types of co-operatives under the new law – general co-operatives and social co-operatives. I am hopeful and eager to see if the new law will help launch more social co-operatives here by providing some tax incentives and government support.
What are some of the main challenges you face promoting social innovation and training social entrepreneurs in South Korea?
Park: Firstly, the term “social innovation” is still vaguely defined here. Most people do not recognize the term. By implementing actual projects, we hope to change the atmosphere here and make more people aware of the sector.
Secondly, complete financial sustainability is hard to achieve for most social enterprises in South Korea. My rough estimate is that over 60% registered social enterprises cannot be run without government support, mainly due to weak business models or reliance on initial funding.
Lastly, some western countries, such as the US and the UK, have strong civil societies. However, in South Korea, we still lag behind in terms of civil society involvement. People do not donate their time or money to social services as much as people in western countries. This makes it difficult for certain NPOs and NGOs to survive here. Some of those NPOs and NGOs are turning themselves into social enterprises, but it is still very difficult for them to sustain their operations.
Ms. Yang, you recently traveled to India and mainland China to research social innovation entities there. What do you think about these two countries in terms of social innovation development?
Yang: First, in both India and China, people are confused about the definition of “social innovation”. Let me focus on China first. On my trip, I was happy to find out that there were so many grassroots organizations there. But I personally feel that a lot of initiatives are still government-driven. Social organizations in China do their work after getting some funding from their government. One issue I see is people at the grassroots level often have limited education. They have problems engaging the larger community or the society as a whole.
On the other hand, China is facing daunting challenges in terms of inequality. Fruits of innovation were not shared by average citizens. Moreover, the focus for social innovation in most developed countries is on governance. But in India and China, how would you examine governance when the situations are so complicated? In my opinion, that’s the reason why most organizations in those two places are still focusing on charity work, not yet “social innovation”. However, I do think social innovation could be a solution for both countries. It would take quite some time.
Overseas media often praised Seoul’s mayor Won-soon Park for promoting social innovation and social economy. What do you think about his role?
Park: Mr. Park is actually the founder of The Hope Institute. He was a lawyer previously and founded a few organizations to make changes in our society. More than a year ago, he was elected as the Mayor of Seoul. Since then, he has been trying to promote social innovation in the city. He also founded the Beautiful Foundation, a fund taking donations from citizen donors and distributing the money to underfunded NPOs and NGOs. He has tremendous impact in the social innovation sector in South Korea.
Editor’s note: The Center for Social Economy and Social Innovation Center are departments within The Hope Institute. This interview was conducted on January 3, 2013.
Prior to working at SIRG, Wendy visited Taiwan as part of a student delegation hosted by the government of Taiwan in 2009. She was selected as a finalist to present a business plan to venture capitalist in Hong Kong Poly U Entrepreneurship Challenge. After graduation, Wendy worked as a business analyst for a large company, and later for a private-equity funded start-up in the U.S. She volunteers for SCORE – “advisor for America’s small business” and is one of the youngest financial instructors for underprivileged women in Houston.
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